Last editedSep 20213 min read
If you own cryptocurrency and you’re looking to either spend it, send it to your crypto wallet or convert it to a different exchange, you’ll first need to know a transaction is verified on the blockchain. A blockchain exists as a digital distributed ledger that contains every single cryptocurrency transaction. Blockchains are what make cryptocurrencies secure and trustworthy, as they make every transaction available to view by the public. Every cryptocurrency transaction must be confirmed on the blockchain before any crypto changes hands.
What does Bitcoin transaction confirmation do?
A Bitcoin transaction, or any cryptocurrency transaction must be confirmed on a blockchain to verify that the transaction is legitimate. A confirmed transaction means that the transaction has been included in a block, and therefore included in the blockchain. That means the transaction has now been officially recorded and verified, the payment can now be processed, and it can no longer be reversed.
How does Bitcoin transaction confirmation work?
Unless you’re what is known as a blockchain ‘miner’, there’s not much you can do to verify a transaction. Instead, you’ll need to leave it to the pros.
Every time you make a Bitcoin transaction, you will be given a ‘private key’ to make the request. Only you have access to this key, and the key is automatically generated and unique for each transaction. You’ll use the private key to request the transaction, and the transaction request will then be broadcast on the Bitcoin network.
Miners will then take your request, along with many others, and privately mine the coded request to ‘solve it’. We won’t get into the mining process here as it is quite complex, but mining is an essential process for Bitcoin transaction verification.
Once it has been solved by a miner, the miner adds it to their own version of the blockchain ledger. Then, other miners and other users known as nodes will verify that the first miner’s proposal is correct and valid, and the new block containing all of those transactions will then be added to the public blockchain. By being added as part of a block to the blockchain, your transaction is now confirmed.
Each block in the blockchain is mathematically connected to the block that came before it. After the block containing your transaction is added to the chain, any block that follows acts as further confirmation. So, each block that follows the first confirmation is another confirmation that your transaction is legitimate.
What is the average Bitcoin confirmation time?
Bitcoin blocks, containing all the most recent transactions, are added to the blockchain every 10 minutes. That means in theory, your transaction will receive its first confirmation within 10 minutes of the request being sent. Unless you’re sending more than $1,000,000 worth of cryptocurrency, it’s unlikely that you’d need more than 6 confirmations for the transaction to be processed, so typically it should not take more than one hour for the transaction to be fully confirmed.
How many confirmations does a Bitcoin transaction need?
The number of confirmations needed for a crypto transaction to be processed will depend on the exchange, and sometimes depend on the amount being transferred. Some exchanges will process a transaction after just one confirmation, many require three confirmations, while some may require up to six. Many Bitcoin wallets won’t process transactions until they’ve been confirmed at least three times.
In most cases, one confirmation is considered enough for smaller transactions below $1,000, three confirmations are best for transactions up to $1,000, and six confirmations are standard for transactions up to $1,000,000.
How to track Bitcoin transactions
It’s easy to check the status of your Bitcoin transaction and see if it has been confirmed, and how many times it has been confirmed. When you send Bitcoins, in addition to the private key, you’re also given a Bitcoin transaction ID (TxID), which you can use to track the transaction.
Bitcoin’s blockchain can be accessed at https://blockchain.info/. Here, you’ll be able to enter your Bitcoin TxID, or your exchange or wallet address, to track your transactions. You will see a summary of information about the transaction, including the number of confirmations it has.
You’ll also be able to see the fee you’ve paid for the transaction. Every transaction comes with a fee that goes towards rewards miner’s receive for solving equations.
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